ALABAMA ADJUSTER UPDATED FINAL PAPER QUESTIONS
AND ANSWERS GRADED A+
✔✔Catastrophe - ✔✔An occurrence or a sequence of occurrences that causes
enormous property losses. Catastrophes are
normally uninsurable by private insurers
✔✔Cause of Loss - ✔✔A form included in a commercial package policy or a commercial
property policy that lists the causes of
loss against which the insured property is covered.
✔✔Certificate of Insurance - ✔✔An official document that contains the details of an
insurance policy. It typically lists the insurance
company, the named insured, what is covered, and the dates of the policy period,
among other things.
Policyholders may be required to present their certificate as proof that insurance
coverage is in effect.
✔✔Commercial General
Liability (CGL) - ✔✔A policy that protects a business against damages and injuries it
may cause to third parties
✔✔Civil Law - ✔✔Observes court cases of one citizen charging another citizen for
damages caused by tort. Differs from
criminal law.
✔✔Claim - ✔✔The request for settlement that the policyholder files with an insurer after
she experiences a loss
✔✔Claims-Made Form - ✔✔A liability policy in which the insurer covers claims that are
filed during the policy period, no matter when
the loss occurred. The opposite of an occurrence form.
✔✔Claims Management - ✔✔The practice of the insurance adjuster of managing a
claim by processing it in a prompt and effective
manner from the time the claim is filed until a settlement is reached, while adhering to
all local and federal
laws.
✔✔Claimant - ✔✔One who files a claim with an insurer for a loss
✔✔Coarse Grains - ✔✔A provision in crop insurance that covers reduction in crop
quality, as well as crop-yield losses. Coarse
grains are corn, grain sorghum, and soybeans
,✔✔Code of Ethics - ✔✔A set of governing professional standards of conduct, usually
created by regulatory bodies or government
regulatory agencies. These standards may also be formally codified with statutes.
✔✔Coercion - ✔✔The practice of forcing another party to behave in an involuntary
manner (whether
through action or inaction) by use of threats, intimidation, or some other form of
pressure or force.
✔✔Coinsurance - ✔✔A property insurance provision that requires the policyholder to
carry adequate coverage (typically at least
80% of the property's value). If a property does not meet this requirement (i.e. if it is
underinsured), the
insurer applies a penalty on claims for partial losses. The penalty requires the
policyholder to pay a
percentage of the claim, depending on how underinsured the property is. To calculate:
divide the actual
coverage by the coinsurance requirement and then multiply that by the loss. In health
insurance,
coinsurance refers to the portion of a covered claim that the insured is responsible for
paying out-ofpocket,
after the deductible has been paid.
✔✔Coinsurance Payment
(Health Insurance) - ✔✔A percentage of the total health care expenses that the insured
must pay.
✔✔Commerce - ✔✔The exchange or transport of goods or property
✔✔Commercial - ✔✔Having to do with commerce or business activity in general
✔✔Commercial Crime
Insurance - ✔✔Commercial insurance that covers employee dishonesty and theft by
employees or others.
✔✔Commercial Lines - ✔✔A variety of insurance coverages that protect those involved
in the business of creating, selling,
displaying, evaluating, or shipping, etc. Examples include: business owner's policy
(BOP); commercial
property; commercial general liability (CGL); workers' compensation (WC); professional
liability, errors
and omissions (E&O); and employment-related practices liability.
✔✔Commercial Property
,Floater - ✔✔A means of protecting a business' property that is not in one fixed location.
Includes domestic shipments,
instrumentalities of transportation and communication, and commercial property floater
risks.
✔✔Common Crop Insurance
Policy - ✔✔A single uniform policy that combines crop revenue coverage, revenue
assurance, income protection, and
indexed income protection
✔✔Common Law - ✔✔Based on court decisions and customs when statutory law does
not provide an answer; creates
precedent.
✔✔Compensatory Damages - ✔✔Money awarded in civil court for tangible and
intangible damages caused by a policyholder. There are two
types: general and special
✔✔Compensatory Damages -
General - ✔✔Money awarded for the emotional losses of the plaintiff that will continue
after the trial date. These are a
subjective value and are determined by the court.
✔✔Compensatory Damages -
Special - ✔✔Money awarded for the exact value of the physical damage caused to the
plaintiff up to the trial date. This
is an objective value determined by receipts and medical bills
✔✔Competence - ✔✔One of the four qualifications of a legally binding contract. All
parties must be competent, with the
necessary legal and mental capacity.
✔✔Complaint - ✔✔A complaint initiates a civil lawsuit by one person (the plaintiff)
requesting financial relief from damages
caused by someone else (the defendant).
✔✔Concealment - ✔✔The act of withholding relevant material facts from an insurer
✔✔Conditionally Renewable
Policy - ✔✔A policy that gives the insurer the option to cancel coverage only if certain
stated conditions are met.
✔✔Conditions - ✔✔The section of a policy that qualifies or limits an insurer's promise to
pay or perform.
, ✔✔Consideration - ✔✔One of the four qualifications of a legally binding contract. All
parties must bring something of value to the
contract.
✔✔Contract - ✔✔An agreement entered into voluntarily by two parties or more with the
intention of creating a legal
obligation.
✔✔Contribution by Equal
Shares - ✔✔Each policy pays an equal share of the loss up to the lowest policy limit. If
the loss is not fully covered, the
process is repeated among the remaining insurers with available coverage. As each
policy limit is
reached, the remaining portion of the loss is split equally between the insurers with
available coverage
until the loss is either fully covered or all of the policy limits have been reached.
✔✔Controlled Line Floaters - ✔✔Standardized forms provided by a bureau and filed
with the state. These forms disclose the rates being
charged and can be used as both general property floaters (such as "personal effects"
or "personal
property") and specific property floaters that break down covered property by type.
✔✔Copayment - ✔✔The amount a policyholder must pay each time she accesses the
benefits of a health insurance policy.
✔✔Coverages - ✔✔The amount and extent of protection provided by an insurance
policy.
✔✔Crime - ✔✔An offense against the state or federal government, or a breach of law,
for which the offender must make
satisfaction to the public
✔✔Criminal - ✔✔Someone who has been convicted of a criminal act in a court of law.
✔✔Crop Hail Insurance - ✔✔A form of crop yield insurance that is usually provided by
private insurers without government subsidy. It
offers named-peril protection on an acreage basis
✔✔Crop Insurance - ✔✔Insurance coverage designed to protect a farmer's financial
investment in his crops. Covers losses to a
crop's profitability.
AND ANSWERS GRADED A+
✔✔Catastrophe - ✔✔An occurrence or a sequence of occurrences that causes
enormous property losses. Catastrophes are
normally uninsurable by private insurers
✔✔Cause of Loss - ✔✔A form included in a commercial package policy or a commercial
property policy that lists the causes of
loss against which the insured property is covered.
✔✔Certificate of Insurance - ✔✔An official document that contains the details of an
insurance policy. It typically lists the insurance
company, the named insured, what is covered, and the dates of the policy period,
among other things.
Policyholders may be required to present their certificate as proof that insurance
coverage is in effect.
✔✔Commercial General
Liability (CGL) - ✔✔A policy that protects a business against damages and injuries it
may cause to third parties
✔✔Civil Law - ✔✔Observes court cases of one citizen charging another citizen for
damages caused by tort. Differs from
criminal law.
✔✔Claim - ✔✔The request for settlement that the policyholder files with an insurer after
she experiences a loss
✔✔Claims-Made Form - ✔✔A liability policy in which the insurer covers claims that are
filed during the policy period, no matter when
the loss occurred. The opposite of an occurrence form.
✔✔Claims Management - ✔✔The practice of the insurance adjuster of managing a
claim by processing it in a prompt and effective
manner from the time the claim is filed until a settlement is reached, while adhering to
all local and federal
laws.
✔✔Claimant - ✔✔One who files a claim with an insurer for a loss
✔✔Coarse Grains - ✔✔A provision in crop insurance that covers reduction in crop
quality, as well as crop-yield losses. Coarse
grains are corn, grain sorghum, and soybeans
,✔✔Code of Ethics - ✔✔A set of governing professional standards of conduct, usually
created by regulatory bodies or government
regulatory agencies. These standards may also be formally codified with statutes.
✔✔Coercion - ✔✔The practice of forcing another party to behave in an involuntary
manner (whether
through action or inaction) by use of threats, intimidation, or some other form of
pressure or force.
✔✔Coinsurance - ✔✔A property insurance provision that requires the policyholder to
carry adequate coverage (typically at least
80% of the property's value). If a property does not meet this requirement (i.e. if it is
underinsured), the
insurer applies a penalty on claims for partial losses. The penalty requires the
policyholder to pay a
percentage of the claim, depending on how underinsured the property is. To calculate:
divide the actual
coverage by the coinsurance requirement and then multiply that by the loss. In health
insurance,
coinsurance refers to the portion of a covered claim that the insured is responsible for
paying out-ofpocket,
after the deductible has been paid.
✔✔Coinsurance Payment
(Health Insurance) - ✔✔A percentage of the total health care expenses that the insured
must pay.
✔✔Commerce - ✔✔The exchange or transport of goods or property
✔✔Commercial - ✔✔Having to do with commerce or business activity in general
✔✔Commercial Crime
Insurance - ✔✔Commercial insurance that covers employee dishonesty and theft by
employees or others.
✔✔Commercial Lines - ✔✔A variety of insurance coverages that protect those involved
in the business of creating, selling,
displaying, evaluating, or shipping, etc. Examples include: business owner's policy
(BOP); commercial
property; commercial general liability (CGL); workers' compensation (WC); professional
liability, errors
and omissions (E&O); and employment-related practices liability.
✔✔Commercial Property
,Floater - ✔✔A means of protecting a business' property that is not in one fixed location.
Includes domestic shipments,
instrumentalities of transportation and communication, and commercial property floater
risks.
✔✔Common Crop Insurance
Policy - ✔✔A single uniform policy that combines crop revenue coverage, revenue
assurance, income protection, and
indexed income protection
✔✔Common Law - ✔✔Based on court decisions and customs when statutory law does
not provide an answer; creates
precedent.
✔✔Compensatory Damages - ✔✔Money awarded in civil court for tangible and
intangible damages caused by a policyholder. There are two
types: general and special
✔✔Compensatory Damages -
General - ✔✔Money awarded for the emotional losses of the plaintiff that will continue
after the trial date. These are a
subjective value and are determined by the court.
✔✔Compensatory Damages -
Special - ✔✔Money awarded for the exact value of the physical damage caused to the
plaintiff up to the trial date. This
is an objective value determined by receipts and medical bills
✔✔Competence - ✔✔One of the four qualifications of a legally binding contract. All
parties must be competent, with the
necessary legal and mental capacity.
✔✔Complaint - ✔✔A complaint initiates a civil lawsuit by one person (the plaintiff)
requesting financial relief from damages
caused by someone else (the defendant).
✔✔Concealment - ✔✔The act of withholding relevant material facts from an insurer
✔✔Conditionally Renewable
Policy - ✔✔A policy that gives the insurer the option to cancel coverage only if certain
stated conditions are met.
✔✔Conditions - ✔✔The section of a policy that qualifies or limits an insurer's promise to
pay or perform.
, ✔✔Consideration - ✔✔One of the four qualifications of a legally binding contract. All
parties must bring something of value to the
contract.
✔✔Contract - ✔✔An agreement entered into voluntarily by two parties or more with the
intention of creating a legal
obligation.
✔✔Contribution by Equal
Shares - ✔✔Each policy pays an equal share of the loss up to the lowest policy limit. If
the loss is not fully covered, the
process is repeated among the remaining insurers with available coverage. As each
policy limit is
reached, the remaining portion of the loss is split equally between the insurers with
available coverage
until the loss is either fully covered or all of the policy limits have been reached.
✔✔Controlled Line Floaters - ✔✔Standardized forms provided by a bureau and filed
with the state. These forms disclose the rates being
charged and can be used as both general property floaters (such as "personal effects"
or "personal
property") and specific property floaters that break down covered property by type.
✔✔Copayment - ✔✔The amount a policyholder must pay each time she accesses the
benefits of a health insurance policy.
✔✔Coverages - ✔✔The amount and extent of protection provided by an insurance
policy.
✔✔Crime - ✔✔An offense against the state or federal government, or a breach of law,
for which the offender must make
satisfaction to the public
✔✔Criminal - ✔✔Someone who has been convicted of a criminal act in a court of law.
✔✔Crop Hail Insurance - ✔✔A form of crop yield insurance that is usually provided by
private insurers without government subsidy. It
offers named-peril protection on an acreage basis
✔✔Crop Insurance - ✔✔Insurance coverage designed to protect a farmer's financial
investment in his crops. Covers losses to a
crop's profitability.
